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Return on College Investment

College is very expensive, and getting more so every year. This is generally considered worth it, however, due to the increased earning potential a college degree brings with it. But how much expense is worth it? Can colleges guarantee a return on the investment you make? Is a college degree money well spent?

In this article, we’ll go over how to get the best possible return on your college degree, and whether or not college is still a worthwhile investment (spoiler, we think it is). College is a major investment of both time and money, and as with all other investments, you should try to maximize your returns. Let’s get started!

What is College Worth?

According to a study by Georgetown, people with college degrees earn 84% more on average than those with only a high school diploma and 31% more on average than those with an Associate’s degree. This does not mean everyone with a college degree earns a great wage, and indeed the same study found gaps in earnings based on race and gender. That said, average wages for college graduates are significantly higher.

The Bureau of Labor Statistics also released projections for job growth; job openings that require a bachelor’s degree will grow faster than the job market as a whole, as employers increasingly consider a college degree a prerequisite for employment. This does not mean all careers require a degree, but a degree is helpful for finding job openings and is required for an increasing number of fields. Whether or not this is necessary is uncertain, but that is the industrial trend.

Thus we can safely say that getting a college degree gives you greater potential for finding employment and a higher ceiling for potential earnings. This doesn’t mean that college is the only way for you to succeed, and a college degree does not guarantee a career. It merely makes your future success more likely.

What Does College Cost?

This depends, but no matter where you go, the answer is increasingly a lot. The price of a college education has increased at more than twice the rate of inflation over the past few decades. While in-state tuition at public universities is often more reasonable, out-of-state tuition and private schools have increased their costs tremendously, and more students are struggling to afford college.

Attending a top-tier private school will set you back $70,000 per year, more than many people earn. Even more affordable schools can go for $10-15,000 per year. One of the biggest challenges students face is not getting into college, but paying for it once they’re there.

We’ve discussed financial aid before, but most students still end up paying for college with loans. As of the writing of this article, Americans owe $1.7 trillion dollars on student loans. Unlike most loans, these cannot be discharged by bankruptcy; you will continue to owe and have to pay back the money until the balance is settled or you die.

This is why college should be seen as an investment; taking a loan now with the promise of higher earnings in the future. Just as money wisely invested in the stock market will bring safe and steady returns, a well-planned college career will set you up well, while a risky or poorly planned investment can see you making big losses.

How to Get a Good Return on College Investment

Here are our steps for making a good return on your college degree:

  1. Have a plan.
  2. Pay as little as possible.
  3. Make sure you graduate.
  4. Manage your repayment.

Have a plan

This is the first and most important step. You can major in almost anything and go on to have a fulfilling career, but having an idea of what you want to do will make your transition to post-college life smoother.

Most students do not end up working in a field directly related to their degree. Indeed, most office workers did not major in business or finance, but instead in the humanities or social sciences. The hard and soft skills you pick up in college are widely transferable; this is the value of a college degree.

You don’t have to have a plan going into college, and the plan you do have can change. That said, to maximize your investment, use the resources your college has to construct and further your plan. Colleges have career centers, job fairs, recruitment events, industry connections, and myriad other resources. Make use of these to format or further your own plan. You are paying for these resources, so use them.

Pay as Little as Possible

This is one of the best reasons to apply to multiple schools. You will receive varied financial aid offers; some schools offer nothing, others a bit, and a few may offer you a lot. The name of a school and the attached prestige matter far less than earning a degree at all (with a few exceptions).

Some companies in some fields will only recruit from top schools; Wall Street especially is notorious for this. For most professions, however, the undergraduate institution you attend doesn’t matter very much, getting a degree at all is what’s key.

Therefore, when deciding which school you attend, you want to minimize your own costs, and loans, as much as you possibly can. It’s easier to make a positive rate of return when the amount you have to pay off is lower. We recommend going to the school which offers you the best financial aid package, rather than one which may seem more prestigious.

Make Sure you Graduate

This is fairly self-explanatory as a step. A college degree is only worth something if you get it; almost doesn’t count. There are legitimate reasons to delay or step back from your education, but once you commit to a degree, we strongly recommend you finish it, even if it ends up being at a different institution. Student loans and no degree is the worst situation to find yourself in.

Manage your Repayment

Many student loans begin accruing interest immediately and will charge you interest on the interest you owe. Thus even loans that are small initially can quickly balloon out of control. Make payments on your loans while still in school if possible, to keep the interest from piling too high.

Further, once you have graduated, look into refinancing or forgiveness programs. Privately refinancing your loans allows you to greatly reduce the amount of interest, which in turn greatly reduces how much you have to pay back. Forgiveness programs are offered for many government careers; after a certain tenure of service, your government-held loans will be forgiven.

The eligibility for student loan forgiveness programs is strict, but if you are interested in a career in education or public service, forgiveness is well worth looking into.

Is College Worth it?

Overall, yes. This doesn’t mean every student is best served by attending college, but overall most students will benefit from earning a college degree. Your career prospects will broaden, your earning ceiling will rise, and your horizons will widen.

This doesn’t mean every college is created equal, nor every degree. You should work to make sure your own rate of return is as high as possible. This means taking advantage of every resource you can, planning for your future, and being deliberate with your choices. College is a major investment, but like all investments, it is worth it if you are judicious.

Final Thoughts

While college is quite expensive, it is an investment worth making. As with any investment, however, you want to maximize your rate of return. Loans can bury you if you aren’t careful, but they can be managed if you work with forethought.

If you want advice on college application strategies to maximize your own rate of return, or have other questions about applying, schedule a free consultation with us. Every student is unique and will need to take a different track to maximize the return on their college investment, and we enjoy helping our students do so.

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Wendy Y.
Parent
Below is my son's review. He was accepted to his dream Ivy League school!

From an admitted student's perspective, I am incredibly grateful to have met Sasha - he has been instrumental in helping me achieve my educational dreams (Ivy League), all while being an absolute joy (he's a walking encyclopedia, only funnier!) to work with.

Many people are dissuaded from seeking a college counselor because they think they can get into their desired college(s) either way. Honestly, going that route is a bit short-sighted and can jeopardize your odds of acceptances after years of hard work. The sad truth is, the American education system (even if you attend a fancy private school and ESPECIALLY if you go to a public school) doesn't really tell students how to write a compelling and authentic application. Going into the admissions process alone, without speaking with an advisor, is like going to court without a lawyer - you put yourself at a significant disadvantage because you don't have all the facts in front of you, or the help you need to negotiate the system.

That said, you need a good lawyer just like you need a good college counselor. And that's where Sasha distinguishes himself from the crowd of people claiming they'll get you into Harvard. I came to Sasha worried about and frankly dumbfounded by the college admissions process. I was unsure what to write about and how to go about drafting the essay that perfectly captured my passion, interests, and self. And I was highly skeptical that anyone could really help me. But, damn, did Sasha prove me wrong. From the beginning, Sasha amazed me with his understanding of the process, and ability to lend clarity and direction to me when I desperate needed it. After interviewing me about my background, experiences, activities, outlook, and vision, he helped me see qualities about myself I had not previously considered 'unique' or 'stand-out.' This process of understanding myself was so incredibly important in laying the groundwork for the essays I eventually wrote, and I'm certain I would've drafted boring, inauthentic essays without it.

Looking back, Sasha's talent is that he can see where your strengths lie, even when you don't see them. The truth is, although we don't always realize it, everyone has a unique story to tell. Sasha helped me see mine, and with his big-picture insight I was able to write the application that truly encapsulated my life and vision. He inspired me to dig deeper and write better, challenging me to revise and revise until my essays were the most passionate and authentic work I had ever written. As clichéd as that sounds, that's really what universities are looking for. In retrospect, it makes sense - in the real world passionate (not simply intelligent) individuals are the ones who make a difference in the world, and those are the individuals colleges would like to have associated with their brand.

In the end, I was accepted to the college of my dreams, a feat I could not have achieved without the direction Sasha lent to me. Essays (and the personal narrative you develop through your application) matter so much, and can literally make or break your application. I have seen so many of my 'qualified' friends receive rejections because they wrote contrived essays that didn't truly represent who they were; conversely, I have also seen so many friends with shorter resumes accepted because they were able to articulate their story in a genuinely passionate and authentic way - I fall into the latter category.

As a former admissions officer at Johns Hopkins, Sasha knows what types of essays jibe well with universities, an invaluable asset to have in the admissions process. He is responsive, flexible, creative, positive, and witty. For anyone who is serious about going into the college admissions process informed and prepared, I highly recommend Sasha.
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Arda E.
Student
I used Ivy Scholars to mainly help me with college applications. Within weeks of using this service, Sasha was able to simplify the already complex process. When it came to writing the Common App essay, Sasha didn’t just help with grammar and syntax, he brought my essays to life. Sasha also worked tirelessly to help solidify my extracurricular activities, including research and internship opportunities. Without his help, I would have never had an impressive resume.

Sasha is not only an extremely knowledgeable tutor, but also a genuine brother figure. His guidance, throughout my last two years of high school, was everything I needed to get me an acceptance letter from my dream schools (UC Berkeley, Tufts, Emory).

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Working with Sasha, I didn’t just become a good student, I became a genuine scholar.
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Samson S.
Parent
We worked with Ivy Scholars during my son's senior year. I was concerned that we may be too late to take advantage of college advising but the Ivy Scholars team quickly and confidently directed us through the steps to ensure no deadlines were missed. Sasha's knowledge about schools, what they looked for in candidates, and how to maneuver the application process was invaluable. Mateo and Ryan worked with my son to help him create an essay that would get noticed and I am so appreciative he had their guidance.

Prior to securing Ivy Scholars, we tried using a less-expensive online service which was a terrible experience. As a parent, Ivy Scholars brought peace of mind to an area that was frankly overwhelming. This service was invaluable in the knowledge that we gained throughout the process. He has also met with my freshman daughter to provide guidance for her high school courses, career paths, extracurricular activities, and more.

Prior to signing with Ivy Scholars, I tried a less expensive online service and was very disappointed.

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